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FOR IMMEDIATE RELEASE
March 8, 2007

Chicago Public Schools Chief Arne Duncan and Chicago Teachers Union Back Governor Blagojevich's Helping Kids Learn plan
Governor announced plan to boost school funding by $10 billion over four years in yesterday’s Budget Address; three times larger than any increase in state history

CHICAGO – Governor Rod R. Blagojevich was joined today by Chicago Public Schools Superintendent Arne Duncan and Chicago Teacher’s Union President Marilyn Stewart at Nettelhorst Elementary to build support for Helping Kids Learn plan, the Governor’s plan to invest an unprecedented $10 billion in schools over the next four years – nearly three times bigger than any increase in state history.  Duncan endorsed the Governor’s education proposal, which would provide more than $395 million in new capital and operating funds to the Chicago Public School system in Fiscal Year 2008.  In past decades, Illinois schools have been chronically neglected and consistently under-funded, but in the past four years, Governor Blagojevich provided $3.8 billion in new dollars to Illinois schools which boosted education funding to record levels. 
 
“We have an obligation to our children.  We owe them a fully-funded, well-rounded, state-of-the-art education, and we can achieve that with new teachers, new classrooms, new materials, and investment that shows they are a priority and our future,” Gov. Blagojevich said.  “We are not talking about a short-term fix – we are talking generations of investment.”
 
“I want to thank Governor Blagojevich for putting forward these proposals.  He has really outlined a bold and ambitious plan to dramatically change the state’s role in terms of school funding.  If this plan goes forward, Illinois will begin to move into the ranks of the more progressive states that have truly made education a priority,” said Arne Duncan, CEO of Chicago Public Schools.
 
Helping Kids Learn continues the Governor’s commitment to schools by boosting funding by an unprecedented $1.5 billion in Fiscal Year 2008.  Under the plan, general state aid to schools will increase by $800 million, raising the Foundation Level by $686 to $6,020.  With more funds per pupil, schools can make investments to improve textbook quality, modernize their technology, or invest in teachers.
 
 “The IFT strongly endorses the Governor’s education funding reform plan.  For the first time, a governor of this state has pledged to fund public education in the way that is needed to give our students world class schools.  This is a bold initiative.  Kids in Illinois will benefit for years to come once this bill becomes law, and we intend to help make that happen,” said Jim Dougherty, President of Illinois Federation of Teachers, which endorsed the Governor’s Education Plan last week.
 
Under the plan, the state will give schools additional funds to help afford special education teachers with $200 million in new spending that will increase the state’s reimbursement rate for special education teachers – the first increase districts have seen since 1985.  With $153 million, the Governor’s plan will fully fund ‘mandated categorical’ programs like special education and transportation.  Chicago Public Schools will receive a 100 percent reimbursement for these costs and a $4.6 million increase in funding for bilingual education.
 
The plan will accelerate implementation of Preschool for All with $69 million in state support and dedicate additional resources for school districts that provide full-day kindergarten.  With a $25.6 million increase in funding for early childhood education, ISBE and CPS conservatively predict this increase will allow CPS to serve approximately 3,000 more kids in FY08. 
 
“I had to take time off when my kids were born, and I was just able to go back when my kindergartener went to school. I was glad I did it, but taking time off was a huge financial strain on me and my family.  So I am pleased with full-day kindergarten, because it allows me to contribute to my family’s well being.  If I had only half-time kindergarten, I would be behind another year financially,” said Laura Holmes, mother of two Nettlehorst Elementary School students.
 
The Helping Kids Learn plan provides $100 million to support underperforming school districts that invest in after school tutoring, curriculum and textbook enhancements, longer school days or other proven strategies that raise student achievement.
 
The plan will also invest $1.5 billion in a capital construction plan for projects to improve and upgrade classrooms and schools so children can learn and teachers can teach in a more conducive environment.  In FY08, Chicago Public Schools would receive up to $112 million for capital projects within the district.
 
The Governor’s Tax Fairness Plan, unveiled during his budget address Wednesday, will raise funds for schools, healthcare, and paying down pension debt.  In Illinois, the share of state revenues coming from individual income taxes has consistently increased during each of the last three decades.  The state income tax burden lies primarily with individuals – many who are struggling to make ends meet – while the burden on businesses has gone down, even while corporations are posting record profits.  Gov. Blagojevich’s Tax Fairness Plan will reverse that trend. 
 
“This funding plan makes corporations pay their fair share, and it’s about time.  For the first time, we have a governor who’s willing to stand for the kids of Illinois, not only in the area of providing $10 billion for the schools, but in the area of healthcare,” said Marilyn Stewart, President of CTU, to express her support of the Governor’s plan.
 
The Governor’s Tax Fairness Plan implements a Gross Receipts Tax (GRT) that has been embraced by many economists because of its broad base and low rates.  States including Washington, Delaware and Hawaii have had a GRT for years, and recently, Ohio and Texas have adopted a form of the tax.  The tax will better reflect the changes in Illinois’ economy since the Corporate Income Tax was implemented thirty years ago when goods dominated the state’s economy.  Today ‘new economy’ businesses – primarily services – represent the majority of Illinois’ business activity.  In fact, goods-based businesses make up only 35 percent of Illinois’ economy, but pay 53 percent of the corporate income tax; services-based businesses make up 65 percent of Illinois’ economy, but pay only 47 percent of the corporate income tax.
 
The GRT will only apply to businesses that make more than $1 million each year, which means that small businesses – 75 percent of all businesses in Illinois – will be exempt.  The GRT will tax service industries at a low 1.8 percent, while manufacturers, construction, retail and wholesale companies will be taxed at an even lower .5 percent.  Exports will not be taxed.  The plan also mitigates costs being passed on to consumers by excluding certain goods, such as retail food and pharmaceuticals.  By transitioning to the GRT, Illinois will rid itself from loopholes that major corporations have exploited and used to their advantage to avoid paying their fair share of taxes to the state, and is expected to generate $3 billion in new revenue in fiscal year 2008, and more than $6 billion during its first full year in effect.


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